How does Multi Sig work?

[gosdorxda]

Newbie learning about multi sig. I watched a number of videos on how to set up multi sig using Electrum and various hardware wallets. I understand the mechanical steps one would go thru to set up multi sig. But something fundamental is not clear to me.

Let's say I set up a "2 of 4" scenario, where two of four individuals (via their hardware wallets) must sign a bitcoin transaction. Where is this "you must have two of these four" rule stored? Is it somewhere on the bitcoin blockchain?

Said differently, if I authorize a spend transaction using my hardware wallet (I am one of the four), how does the exchange (Coinbase, or any other non-Electrum) know that a second signature is required?

Thanks.

[gosdorxda]

The exchange or the receiver does not need to know if a second signer is needed because the transaction will not be broadcasted at all. Only when the transaction would be broadcasted to the mempool is when the second signer sign the transaction.